Entrepreneurship

PREPARED BY: BIRUK J. (MSC)

  Brain storming questions?
 What is Entrepreneurship?
 Employee vs Entrepreneur; and which one is your
interest?
 Does our economy can engulf every graduates of the
university?
 Who are an entrepreneurs?
 INTRODUCTION TO
ENTREPRENEURSHIP

 What is Entrepreneurship?
 Koontz & Fulmer: “The ability of a person to see a business
opportunity, to get together the capital needed to take
advantage of the opportunity, and to start a business, taking the
risk of failure in the hope of reaping the rewards of success.”
 Kuratko D F and Hodgetts R M: "The process of organizing,
managing and assuming the risks of a business”
 Nathaniel H Leff: "Entrepreneurship is the capacity for
innovation, investment, and expansion in new markets,
products, and techniques.
 Contd…

 The process of entrepreneurship includes five critical

elements:
1) The ability to perceive an opportunity
2) The ability to commercialize the perceived
opportunity i.e. innovation
3) The ability to pursue it on a sustainable basis
4) The ability to pursue it through systematic means
5) The acceptance of risk or failure.
 Contd…

 Does our economy can engulf every graduates of the

university?
 Most economists today agree that entrepreneurship is
a necessary ingredient for stimulating economic
growth and employment opportunities in all societies.

 In the developing world, successful small businesses are

the primary engines of job creation, income growth, and
poverty reduction.
 Contd…

 Therefore, government support for entrepreneurship is a

crucial strategy for economic development.

 The culture of a community also may influence how much

entrepreneurship there is within it
 Contd…

 Who are an entrepreneurs?

 An entrepreneur is any person who creates and
develops a business idea and takes the risk of setting up
an enterprise to produce a product or service which
satisfies customer needs.
 Entrepreneur is a person who organizes, operates, and
assumes the risk of his or her own venture and rewarded
accordingly by either monetary or non-monetary profit or
losses
 S/he is a contractor acting as an intermediary between
capital and labor
 Contd…

 Entrepreneur is an individual who is able

 To recognize potentially profitable opportunities,
 To conceptualize the venture strategy, and
 To become the key force in successfully moving the idea
from the laboratory to the market place (consumer)
 Types of Entrepreneurs

 The individual entrepreneur: An individual

entrepreneur is someone who started; acquired or
franchised his/her own independent organization

 Intrapreneur: An Intrapreneur is a person who

does entrepreneurial work within large organization.
The process between two actors is known as
Intrapreneurship.
 Employees vs. Entrepreneurs

 Salaried persons enjoy almost certain employment for a

number of years without much risk

 These person get a certain income at the end of a week or

month, may not be that big a sum

 They may not require doing something very unique for

their rise or promotion in the job, in many of the public
jobs years of experience is enough.
 Contd…

 Some disadvantages of being employee:

 Subordinated rights
 Limited earnings
 Curbing of initiatives
 Possibility of mismatched career
 Does not enjoy any pleasure of doing anything unique
 Cannot easily provide jobs at their choice for someone
they require to do
 Contd…

 Some advantages of being entrepreneur:

 Sense of ownership
 Security (No one can fire him)
 Independence
 Growth
 Legacy (heirs can inherit wealth)
 Enjoy greater prestige and status in the society
 Desire to supplement income after retirement
 Efficient and creative
 Contd…

 Risks of Entrepreneurship
 Financial
 Career
 Self-esteem
 Stress
 Benefits of Entrepreneurship

 Improves working culture

 Enables to use own technology and skill
 Independence/freedom/self reliance/self-esteem
 Flexibility
 Pleasure
 Possibility to involve in community service
 Benefits of employee

 Enjoys holidays
 Political/social instability did not affect their income
 Scheduled working times
 Has better family and social life
 Who can be an entrepreneur?

 Amazing facts of entrepreneurs

 Childhood background: First child/only child for the
family
 Parental background: Self employed parents
 Age: Early of 30 for Males and Late of 30 for Females
 Educational background: 1st degree (usually BA degree)
 Marriage background: Married
 Work environment background:
Unsatisfied/Unsuccessful; eg. Einstein, Thomas Edison
 Contd…

 Who can be an Entrepreneur?

 There is no definitive profile
 Successful entrepreneurs come in various ages, income
levels, gender, and race
 They differ in education and experience
 But research indicates that most successful entrepreneurs
share certain personal attributes, including: creativity,
dedication, determination, flexibility, leadership, and self-
confidence
 Contd…

 Creativity is the spark that drives the development of new

products or services or ways to do business
 It is the push for innovation and improvement
 It is continuous learning, questioning, and thinking outside of
prescribed formulas

 Dedication to start is what motivates the entrepreneur to

work hard, especially in the beginning, to get the endeavor off
the ground
 Planning and ideas must be joined by hard work to succeed
 Dedication makes it happen
 Contd…

 No risk aversions: Entrepreneurs don’t fear to

make a decision for new thing and have no fear of
taking risks.
 But it does not meant by that they are blind decision
makers.
 Contd…

 Determination/commitment is the extremely strong

desire to achieve success
 It includes persistence and the ability to bounce back after
rough times.
 It persuades the entrepreneur to make the 10th phone call,
after nine have yielded nothing
 For the true entrepreneur, money is not the motivation
 Success is the motivator; money is the reward
Bangkok’s temple of Wat Traimit
 Contd…

 Michael Jordan, one of the greatest basketball players of all

time.
 “I’ve missed more than 9000 shots in my career. I’ve lost 300
games. 26 times, I’ve been trusted to take the game wining
shot and missed. I’ve failed over and over and over again in
my life. And that is why I succeed.”
 Contd…

 Flexibility is the ability to move quickly in response to

changing market needs
It is being true to a dream while also being mindful of
market realities
Rather than risking the loss of customers, the entrepreneur
modifies his/her vision to accommodate the needs of its
customer.
 Contd…

 Leadership is the ability to create rules and to set goals

It is the capacity to follow through to see that rules are
followed and goals are accomplished
 Contd…

 Self-confidence comes from thorough planning, which

reduces uncertainty and the level of risk

 It also comes from expertise

 Self-confidence gives the entrepreneur the ability to listen

without being easily swayed or intimidated
 Contd…

 Every entrepreneur has these qualities in different

degrees.

 But what if a person lacks one or more? Many skills can

be learned. Or, someone can be hired who has strengths
that the entrepreneur lacks.

 The most important strategy is to be aware of strengths

and to build on them.
 Qualities of an Entrepreneur

 Opportunity-seeking
 Persevering/commitment
 Risk Taking
 Demanding for efficiency and quality
 Information-seeking
 Goal Setting
 Planning
 Persuasion and networking
 Building self-confidence
 Listening to others
 Leadership
 Entrepreneurial skills

A. General Management Skills

 These are skills required to organize the physical and
financial resources needed to run the venture
 This skills includes Strategy Skills, Planning Skills,
Marketing skills, Financial Skills, Project Management
Skills and Time Management Skills
B. People Management Skills
These are skills required to in the way how the
entrepreneur deals with other peoples
It includes Communication Skills, Leadership Skills,
Motivation Skills, Delegation Skills and Negotiation Skills
 Creativity, Innovation and
Entrepreneurship

 Creativity is the ability to develop new ideas and to

discover new ways of looking at problems and
opportunities
 It is thinking of new things
 Developing creativity is a process of changing the
way you look at things
 In order to do this, you must look for different or
unorthodox relationships between people and things
and to view them in terms of how they can be used to
satisfy needs (both as resources and problem solvers)
 Contd…

 Barriers of creativity
 Searching for the one ‘right’ answer
 Focusing on being logical
 Blindly following the rules
 Constantly being practical
 Fearing mistakes and failure
 Believing that ‘I’m not creative’.
 Contd…

 Innovation is the ability to apply creative solutions

to problems and opportunities in order to enhance
people’s lives or to enrich society

 It is doing of new things which can vary from

producing of new goods or services, method of
production or opening of new market or new source
of supply
 Contd…

 Four types of innovation

 Invention - described as the creation of a new
product, service or process
 Extension - the expansion of a product, service or
process
 Duplication - defined as replication of an already
existing product, service or process
 Synthesis - the combination of existing concepts and
factors into a new formulation
 Contd…

 Entrepreneurship is the result of a disciplined,

systematic process of applying creativity and innovation
to needs and opportunities in the marketplace.
 Characteristics of successful entrepreneurs generally
include:
 A positive self-image,
 Being motivated by challenging problems,
 Being sensitive to the world around them, and
 Being good at gathering different ideas in a short
amount of time.
 Contd…

 Entrepreneurship is described as an action-oriented

way of thinking, the focus of which is creativity,
innovation and change
 Therefore, it is not surprising to see that
entrepreneurs are among the more creative and
innovative players of organizational change
 It is the entrepreneurs’ business to generate or add
value as they venture, introducing new forms, new
organizations, new products and new language to the
world at large
Contd…
Role of Entrepreneurs in Economic Development

 Improvement in per capita Income/Wealth

Generation
 Generation of Employment Opportunities
 Balanced Regional Development
 Enhance the number and diversity of Enterprise
 Economic Independence
 Combine Economic factors
 Provide Market efficiency